What is an “Early-Stage” Startup?
What is a startup
Let’s begin by defining a startup. A startup, simply put, is just a newly established business. In the past few years, however, many business schools and publications have come up with a more specific definition of what a startup truly is.
The definition of a ‘startup’ that is most accepted by business schools was defined by Steve Blank, a serial entrepreneur and professor at business schools such as Stanford, Berkeley and Imperial College. The definition is as follows: a startup is “a temporary organization designed to look for a business model that is repeatable and scalable.”
Startup Life Cycles
Startups have complex life cycles that can be divided into three stages: Early stage, Venture-Funded stage, and Late Stage. The length of each stage will vary depending on the business execution, industry, fundraising, and evolution of the idea over the process. Knowing which stage you are on will allow you to set the right goals and plan the next steps.
The early-stage startup describes a company that might have an idea in place but has yet to secure its first Series A funding round. While the full startup cycle can be composed of those three main stages previously described, we also divide the life of an early-stage startup into three phases: Launch, Growth, Funding-Ready.
The first phase, launch, begins with a potentially scalable idea for a product or service for a specific market in which the product or service will add value. During this phase, the team may be small with just one or two people, and it’s when founders define the vision and mission for the company, set key goals and milestones, and put the tools and processes in place to start developing the idea or product. When a startup has an idea and business plan in place, they’re ready to launch and shift their focus to growth. In this phase, a startup will focus on their customer acquisition strategy, sales process, conversion rate, etc.
When a startup moves to the Funding phase of their early-stage, founders will create a Pitch Deck for pre-seed and seed money funding, which will allow them to build out their team, infrastructure and establish their sales function. The pitch deck is a visual document that provides investors with essential information about your business plan, product or services, fundraising needs, and key metrics like valuation, target market, and financial goals.
The Scaling Process
It’s important to remember that the scaling process might be unpredictable and most often not a linear process. Founders must take advantage of their opportunities, and keep in mind that smaller tasks might be a bit repetitive or not interesting but are necessary to lead the company to the growth stave.
As “American Dream” as it sounds to start a new company and grow a startup, it’s a very exhausting and lonely process with almost half startups failing during their early-stage. It has been shown that connecting with mentorships, framework and capital is proven to improve the success of a startup through their early days.
It is highly advised for founders to meet and connect with mentors, investors, former professors, industry or subject-matter experts, knowledgeable friends or family members, small-business counselors, or others who can help them bounce off ideas, ask questions and be a good and reliable resource for the startup. When founders don’t have such a community readily available for them, they may choose to join a startup accelerator.
A startup accelerator can be very beneficial during this early-stage, especially if a founder doesn’t have experience starting or running a business, has a small network or professional contacts, or they are not very familiar with the market or sector where the product is directed to.
An accelerator is a mentor-based program that provides guidance, support, and organization to structure and prioritize your milestones, and to help you navigate through the startup world so you can best grow your company.
When applying for a startup accelerator program, founders are expected to have the prototype, the product itself, or idea. Usually, in exchange for equity or monthly fee, founders will be advised by a wide range of advisors and experienced entrepreneurs who’ll help them develop their service/product, create their business plan, and connect with investors.
Navigate - A new kind of startup accelerator
While most accelerator programs are willing to help you for a piece of your pie, Navigate offers non-equity assistance because we believe you should not have to sell your startup’s soul (or equity) to get advisory assistance and support during this crucial stage.
Getting your startup to launch and grow successfully means you can have full autonomy of it, without having to give pieces of it away until you’re ready to do so. We also understand that timing is not the same for everyone, so we don’t run cohorts. Cohorts start on a specific date and have an ending to them. We know sometimes you can’t wait that long. You can get started with Navigate in as little as a week, and you can pause or end the program at anytime based on your startup’s needs.
To learn more, book some time with us here.